$30B in new federal education funding could help US wireless industry

The $2 trillion Coronavirus Aid, Recovery and Economic Security (CARES) Act could offset some of the economic pain the pandemic is causing for the nation's telecom and wireless carriers.

After all, analysts are predicting significant reductions in sales of wireless services due to the spread of the virus.

In response, lobbyists for AT&T and Verizon have reportedly asked Congress for funds that could be used to supply phones and Wi-Fi hotspots to teachers and families, and the bill that has been approved by the Senate allocates billions of dollars that can potentially be used to help students connect to their teachers and classwork.

The CARES Act, which the President is expected to sign into law once it reaches his desk, appropriates $30.7 billion to the Department of Education to "prevent, prepare for and respond to coronavirus." Roughly 44% of that amount, or about $13.5 billion, goes to a relief fund for elementary and secondary schools and will be administered through state education agencies.

The agencies are instructed to use the funds for "planning for and coordinating during long term closures … including how to provide technology for online learning to all students." Online learning resources are likely to include Wi-Fi routers and mobile hotspots. The bill says the funds can be used for "purchasing educational technology (including hardware, software and connectivity) ... that aids in regular and substantive educational interaction." The funds will be available for purchases that support online learning even if students are not required to stay at home, and the legislation specifically references "online learning during the summer months" as an appropriate use of funds.

The bill says state education agencies can use the funds to "plan how to provide online learning to all students," but no specific provision is made for assisting students whose homes are not served by wired or wireless Internet.

The money comes with a "use it or lose it" provision requiring states to return any remaining funds to the Department of Education one year after they receive them. Funds are expected to be allocated within two months after the bill is signed.

Not all of the funds will be used to support online learning. The money will also support coordination with public health departments, the purchase of cleaning and sanitization supplies, staff training on sanitization procedures, and "continuing to employ existing staff of the local educational agency."

E-Rate too
In addition to the CARES Act, the federal E-Rate program could help wireless carriers weather the coronavirus storm. E-Rate, established by the Telecommunications Act in 1996, provides federal funding for educational technology. Because of COVID-19, a trio of Democrat Senators is asking the Republican-controlled FCC to allow schools to use E-Rate funding to provide Wi-Fi hotspots to students who lack Internet access at home. The Senators noted that annual E-Rate funding is capped at $4 billion and that $2 billion has already been spent this year, potentially leaving $2 billion for addressing the so-called "homework gap" with Wi-Fi connectivity.

"We believe that the FCC can use its emergency powers to temporarily waive relevant E-rate program rules and allow its beneficiaries to utilize universal service funding to provide home wireless service to existing school devices and hotspots for students who lack internet access at home," the Senators wrote in a letter to FCC chairman Ajit Pai. "This swift, immediate action would help ensure that all students can remotely continue their education during the current public health emergency."